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Lion Quits Craft Beer Industry Association

March 7th, 2017, by Crafty Pint

Lion Quits Craft Beer Industry Association

March 7th, 2017, by Crafty Pint

Three Lion-owned breweries have resigned their membership of the Craft Beer Industry Association (CBIA). The decision by Malt Shovel (James Squire), Little Creatures and White Rabbit was announced in a statement by Chuck Hahn (pictured above at a collaboration brew launch in Brisbane), one of the most prominent figures in the Australian beer industry since the 1980s and a longstanding board member of CBIA.

The announcement comes just months after Little Creatures' marketing manager Ash Cranston was appointed to the role of National Craft Brewer representative within the national body.

In the statement, reference is made to a "divisive" and distracting "current internal focus on ‘big vs. small’" within the Association. Late last year, CBIA announced it had been "asked by some of our members to reassess the Association's membership structure with a view to placing greater emphasis on independent breweries." While the exact nature of what any proposed changes will look like are yet to be signed off by the Association, it is widely expected to lead to the departure of the big brewers – Lion, CUB, Asahi and Australian Beer Co.

Today's statement is the latest move in a debate that has run as long as CBIA has been in existence. When the Association first started to take shape in 2011, it did so alongside ARCBA (Australian Real Craft Brewers Association), a separate organisation founded by brewers for whom one key point of difference with CBIA was the makeup of its membership. Including the larger, foreign owned brewers was a reason behind one of the country's largest microbreweries, 4 Pines, also declining to join CBIA and played a role in Feral Brewing, whose owner Brendan Varis is a past director of CBIA, also giving up their membership.

In his statement (which is published in full below), Chuck says "it is short-sighted for the craft sector to be squabbling amongst ourselves. We should be working together to build craft in Australia – feeding off one another’s success as we always have done – rather than confusing beer drinkers into thinking ownership structure has any impact on the quality of what they’re drinking."

UPDATE: We have now received a statement from CBIA not available at time of publication.

CBIA has since released a statement regarding its ongoing reform (published in full below), which states that its "new direction will allow a renewed focus on independent Australian brewers, ensuring its time and resources are directed towards supporting those businesses as a collective."

The Association also praises the work of Chuck and Ash, as well as the contribution made by Lion, concluding: "The craft brewing landscape has evolved considerably from the early days of the CBIA just four years ago. There are now more than 400 independent brewers in Australia, facing many challenges unique to the small, independent end of the market. The CBIA looks forward to advocating further for the interests of our members as a clear and focused voice for independent brewers and, where our interests align, working alongside the nation’s multi-national brewers."

Mazen Hajjar, CEO of Melbourne based Hawkers Beer, described the statement as "disingenuous" and claimed that it avoided the real issues driving the debate.

Mazen (pictured above), who says he is an admirer of Chuck's, visiting him on his first ever trip to Australia and proudly posting an Instagram photo of the their meeting, told The Crafty Pint: "This issue isn't on a personal level with Chuck or with the quality of the beer that is coming out of the big brewers. The problem is with the behaviour of the big brewers.

"It's disingenuous of them to claim that they are simply trying to push craft beer when at the same time they lock taps and prevent other smaller brewers from accessing the market."

He says it is the smaller, independent brewers that are exciting consumers, creating stories and interaction with the public as opposed to big brewers he says are seen as "faceless organisations that don't give back."

Mazen adds: "Primarily, the issues that do face us as craft brewers are market access and excise. For them to say they are fighting for good beer when they are blocking off access is bullshit.

"We want fair taxation when compared to other beverages, but Lion owns wineries and will not lobby the Government for fair excise as they would lose more [from wine than they would gain from beer]. The big brewers are doing everything counter to what would help further a healthy market.

"If you say, 'I've got great beer' then you don't need to be blocking the market, let it compete on its own merits."

Former CBIA board member Ben Kraus, founder of Bridge Road Brewers, said there were many positives in any move to make the CBIA a body for independent Australian breweries, adding that some founding members who had pushed hard for the inclusion of the big brewers at the start now accepted it was time for change.

"The industry is now strong enough to stand on its own feet," says Ben. "The pressure was applied through the survey [of CBIA members last year]; the result was that we didn't need the multi-nationals.

"We've got a really strong national brewer, Stone & Wood, some really high level national brewers like Feral and 4 Pines who keep growing and Gage Roads, who are publicly listed but are looking to be independent of the major liquor chains. So there's a real movement towards independence and people looking after themselves."

He was keen to point out that perceptions the big guys were "calling the shots" within CBIA are far from the truth, saying that in his position as the major breweries' representative on the board, Chuck faced "uncomfortable moments" that he was "very gracious about".

However, the Beechworth brewer said the survey also showed that CBIA was likely to attract more new members, including the aforementioned 4 Pines and Feral, if it took the decision to become a body representing independent brewers.

Chuck Hahn's statement in full

Malt Shovel Brewery (James Squire brewers) and the Little Creatures and White Rabbit breweries last night decided to resign their memberships of the Craft Brewers Industry Association (CBIA). We have great respect for the CBIA and have supported it since its beginning – however, we believe the current internal focus on ‘big vs. small’ is divisive and a distraction from more important issues and opportunities facing the brewing industry.

There is a part of the industry that seems intent on defining itself not in terms of what’s great about craft – the quality beers, the passionate brewers and the characters behind them – but in terms of who owns what.

No matter who you are, you have to raise the funds to brew from somewhere, whether it be your bank, wealthy private investors, shareholders or otherwise. I don’t see how that should make any real difference to beer drinkers who generally only care about the quality and variety of the beer they are drinking. And if we measure brewers by their scale, and they need investment to achieve that scale, what message are we sending them – if drinkers love your beer and you grow as a result you are no longer a legitimate brewer?

I’ve been brewing with the support of Lion for over 20 years now and they have let me get on with what I do best. When my team and I first created James Squire we did so working for Lion, but we chose to grow the brand outside Lion’s distribution system at the outset. Once we grew to scale working with Lion then allowed us to get James Squire out to more beer lovers than we would have been able to reach on our own.

We have consistently brewed some of the most authentic, diverse, often challenging and always high quality brews available in Australia. In doing so, we, along with Matilda Bay, Hahn and Little Creatures, essentially launched the craft segment in Australia. Coopers was certainly one of the original craft brewers.

Ironically our Little Creatures Pilsner was only last year named Champion Australian Craft Beer at the CBIA’s 2016 Craft Beer Awards – the result of a blind taste test by expert judges, who were unable to pay attention to the beer’s ultimate owner. We were the only Australian brewer to win a Gold Medal in the World Beer Cup last year with James Squire Swindler. This is what we care deeply about – the quality of our beers.

On that basis we believe it is short-sighted for the craft sector to be squabbling amongst ourselves. We should be working together to build craft in Australia – feeding off one another’s success as we always have done – rather than confusing beer drinkers into thinking ownership structure has any impact on the quality of what they’re drinking.

Brewing is currently facing a number of challenges. Chief among them are the widespread misinformation about beer among consumers, and an increasingly hostile regulatory environment that threatens to undermine a vibrant beer culture for the responsible majority. Only by working together can we address these issues.

For Lion’s part, we will continue to brew great craft beers and nurture talented brewers. We will continue to innovate. We will continue to invest in and lead the Brewers Association of Australia and New Zealand and the Institute of Brewing and Distilling. We will keep investing in growing the entire beer category.

We wish CBIA every success and hope the industry will find a way to unite and collaborate on important issues into the future.

CBIA Reform Direction Taking Shape

As a result of strong lobbying by its membership, the board of the Craft Beer Industry Association (CBIA) has recently been working towards a membership reform agenda that will put a focus on the independent brewers within our industry. Subsequent industry consultation has strongly supported this move.

Board deliberations have focused on pathways to achieve the industry’s requested outcome, while maintaining our industry’s great capacity for knowledge sharing and personal camaraderie and support.

The CBIA will re-define membership eligibility based on independent (privately held) brewers without relying on an arbitrary definition of ‘craft beer’. It is proposed that the board structure and the name of the association will both be changed to reflect the new direction. The CBIA’s proposed new direction will allow a renewed focus on independent Australian brewers, ensuring its time and resources are directed towards supporting those businesses as a collective.

The Board is now progressing more detailed development of the proposal, with a view to taking its recommendations to an Extraordinary General Meeting of members in Melbourne during Good Beer Week. The details of the necessary constitutional changes are being prepared by the CBIA’s lawyers, Minter Ellison. In the lead up to the EGM, forums will be held in each state, providing an opportunity for interested parties to ask questions and obtain more information. The first forum is planned for 20th of March in Hobart.

In response to the CBIA’s plans, Ash Cranston has offered his resignation from his position as National Craft Brewer representative on the board and all Lion breweries (Malt Shovel Brewery, Little Creatures, White Rabbit and Byron Bay Brewery) have resigned as CBIA members. This morning Lion released a statement from Chuck Hahn announcing Lion’s decision.

The CBIA acknowledges and thanks Ash for his commitment to the association, not just in his relatively short time as a director, but across a number of years. We would also like to acknowledge the very generous support that Lion has afforded the CBIA since its inception.

Chuck Hahn is an undisputed pioneer of the craft beer movement in Australia and his contribution to the industry and to the CBIA’s creation and development over the years cannot be overstated. We owe Chuck a debt of gratitude and know that he will continue to be a much loved and celebrated member of our industry.

The entire focus of the CBIA is on ensuring it is an industry association that supports the brewing businesses that need it. It would be unexpected if Lion believed they needed our help. Of course the multi-national brewers continue to be represented by their own Brewers Association of Australia.

The craft brewing landscape has evolved considerably from the early days of the CBIA just four years ago. There are now more than 400 independent brewers in Australia, facing many challenges unique to the small, independent end of the market. The CBIA looks forward to advocating further for the interests of our members as a clear and focused voice for independent brewers and, where our interests align, working alongside the nation’s multi-national brewers.

Today, we launch a two-part series looking at the issue of ownership in the Australian beer world. As well as seeking the views of various people in the industry, we have compiled a fun graphic showing who's behind some small Australian brands.
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Breweries will be able to hire brewers from overseas more easily after Hawkers successfully secured a 457 visa for one of their brewers. This is the first time brewing has been recognised as a skill suitable for a Temporary Work (Skilled) Visa.
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The Crafty Pint is an independent online magazine and resource for anyone interested in craft beer in Australia. We bring an honest, old-fashioned journalistic approach to beer's brave new world, telling stories because they're worth telling not because someone is paying us to write them.

Like many of the people who have changed the face of beer in Australia, we believe in authenticity, integrity, enjoyment and love. We hope to play a role in helping good beer, brewed by good people, find its way into the hands of more drinkers.